Forty-six percent of those leaving a job in 2008 tapped into their 401(k), maintaining an “alarmingly high” rate of people cashing in since 2005, Hewitt Associates said. Sixty-percent of those cashing in were in their 20s, and 33% were in their 50s.
If you are in the unfortunate position of having lost your position recently, I urge you not to cash out your qualified plan dollars. A seemingly small amount in these accounts now WILL become a substantial amount when it comes time to retire. If you want me to do a quick calculation on what your “small” 401(k) balance will become by the time you will truly need it, drop me a quick email.